Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
I NCOME T AX - I MPORTANT S ECTIONS
(CA I NTER - M AY 2023)
Section Number Brief Description
Basics & Computation of Tax
2(7) Definition of Assessee
2(31) Definition of Person
2(9) Definition of Assessment Year
3 Definition of Previous Year
87A Rebate upto INR 12,500 allowed to Resident Individual if Total Income is upto 5,00,000
115JC Special provisions for payment of tax by certain persons other than a company (AMT)
115JD AMT credit to be carry forward for the next 15 years
115BAC Option to pay tax at concessional rate by Individual/ HUF
288A Rounding off of Total Income to nearest 10
288B Rounding off of Tax Payable to nearest 10
Residential status
6(1) Residential Status of Individuals
6(1A) Deemed Resident
6(6)(a) RoR/ NoR in case of Individuals
6(2) Residential Status of HUF, Firm, LLP, AOP and BOI
6(6)(b) RoR/ NoR in case of HUF
6(3) Residential Status of Company [Section 6(3)]
Note: You may also memorise only Sec 6 and 6(1A) and ignore other sub sections or clauses.
Scope of Total Income/ Incidence of Tax
5 Incidence of Tax or Scope of Total Income
5(1) Total income of a person who is a Resident (RoR and NoR)
5(2) Total income of a person who is a Non-Resident
9 Income deemed to accrue or arise in India including Significant Economic Presence
Exempt Incomes
10(1) Exemption to Agricultural Income
10(2) Any sum received by an individual as a member of HUF from the income of HUF
10(2A) Share of profit received by a Partner from a partnership firm
10(4) Interest on Non-Resident (External) Account
10(5) Leave Travel Concession/ Allowance
10(7) Allowance & perquisites to Indian citizen who is Govt. employee outside India
10(10) Receipt of death-cum-retirement Gratuity
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Section Number Brief Description
10(10A) Receipt of Commuted Pension
10(10B) Receipt of retrenchment compensation
10(10C) Receipt of compensation at the time of voluntary retirement
10(10BC) Compensation from Government in case of disaster
Income tax paid by Employer on Non-monetary perquisite exempt in hands of
10(10CC)
Employee
Maturity proceeds of life policy is exempt if annual premium paid is within the
10(10D)
prescribed limit
Payment from a Provident Fund (PF) to which Provident Fund Act, 1925, applies or
10(11)
from Public Provident Fund would be exempt, subject to conditions
Accumulated balance due and becoming payable to an employee participating in a
10(12)
Recognized Provident Fund (RPF) would be exempt, subject to conditions
10(13A) Exemption in case of House Rent Allowance
10(15) Certain Exempt Interest income
10(16) Scholarship to meet cost of education
Any payment of award or pursuant to an award by CG, SG or by anybody corporate
10(17A)
and approved by the CG in the public interest is exempt from tax
10(18) Pension received by recipient of gallantry awards is exempt from tax
Exemption in respect of family pension received by the widow or children of a member
10(19) of the armed forces (including para-military forces) where the death of such member
has occurred in the course of operational duties
10(26AAA) Income of Sikkimese Individual
10AA Special provisions in respect of newly established Units in Special Economic Zones
Salary
15 Charging Section
16 Deductions from salaries (you may memorise only Sec 16 for all 3 deductions)
16(i)(a) Standard deduction upto INR 50,000
16(ii) Entertainment allowance
16(iii) Professional tax or tax on employment
17 (1) Followings are also included in the salary:
Wages, Pensions, Leave salary, Advance salary, Arrears of salary, Retirement benefits
Gratuity / Provident funds/ Commuted Pension / Allowances / Employer’s contribution
to NPS u/s 80CCD etc.
17(2) Perquisites included in the salary
17(3) Profits in Lieu of salary
89(1) Relief in case of arrears of salary/advance salary
Income from House Property
22 Basic rule for computing Annual Value of House Property
23 Computing Gross Annual Value [GAV] under various conditions
24 (a) Standard deduction @ 30% of Net Annual Value
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Section Number Brief Description
24 (b) Interest on borrowed capital in relation to purchase/ construction/ reconstruction/
repair/ renovation of House Property
25 Amounts not deductible from income from house property – No deduction for Interest
u/s 24 (b) where Interest is payable outside India
25A Recovery of Unrealized Rent/Arrears of Rent deemed to be income of the PY in which it
is received. Deduction of 30% is allowed
26 Tax Treatment of Co-owned Property
27 Deemed Owner
Profit and Gain from Business & Profession
28 Incomes taxable under the head Profit and Gain from Business and Profession
29 Computation of profits and gains from business or profession
Admissible deductions [section 30 to 37]
30 Rent, rates, taxes, repairs & insurance for buildings
31 Repairs & insurance of machinery, plant and furniture
32 Depreciation of any kind viz. normal depreciation, additional depreciation etc.
35 Expenditure on scientific research [in house or donation]
35AD Deduction in respect of Expenditure of capital nature for Specified Business
35D Amortisation of certain preliminary expense to a Resident
35DD Amortisation of Expenditure in case of amalgamation & demerger
35DDA Amortisation of Expenditure incurred under VRS
36 Other Deductions viz. deduction for Employer’s contribution to Recognised fund; and
➢ Bad debt ➢ STT/ CTT ➢ Premium for stock insurance
➢ Interest on loan ➢ Family planning expenses ➢ Discount on zero coupon bonds
General revenue deductions related to business which have been neither specifically
37(1)
allowed nor disallowed
Proportionate allowance of Expenses/ depreciation on Building, etc., partly used for
38
business, etc., or not exclusively so used
Inadmissible Deductions [Sec 40]
40(a)(i) 100% disallowance in case of payment outside India or to a NR in India without TDS
40(a)(ia) 30% disallowance in case of payment to a resident in India without TDS
40 (b) Deduction for salary, bonus, commission, remuneration, interest paid to Partners
Expenses or Payment not deductible in certain circumstances [section 40A]
40A(2) Disallowance of Excessive/unreasonable Expenses involving Payments to Relatives
Disallowance in case of payment in excess of INR 10,000 other than by prescribed
40A(3)
modes
Rule 6DD Exceptions to sec 40A(3)
40A(7) Disallowance of provision for gratuity
40A(9) Disallowance Related to Employer’s Contribution to Various Funds
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Section Number Brief Description
Profits/Recoveries chargeable to tax under PGBP in the year of recovery irrespective of
41
whether Business is in existence or not (You may simply memorise sec 41)
Recovery against deductions allowed in any previous year or Remission or cessation of
41(1)
trading liability
41(3) Sale of asset used for scientific research
41(4) Recovery of bad debts
Other provisions
43A Treatment of Foreign Exchange Fluctuations on purchase of Assets from outside India
43(1) Actual cost i.e the cost on which depreciation is allowable
Certain Deduction to be allowed Only on Actual Payment i.e. paid before the due date
43B
of filing ROI.
Stamp duty value of land and building, held as stock in trade, to be taken as the full
43CA
value of consideration in respect of transfer if SDV > 110% of consideration
44AA Compulsory maintenance of accounts
44AB Compulsory Tax Audit
Presumptive taxation in case of Resident individual/Firm/HUF having business turnover
44AD
upto 2 crores @ 8% / 6%
Presumptive taxation in case of Resident having professional gross receipt upto 50
44ADA
lakhs @ 50%
Presumptive taxation in case of GTA (having not more than 10 goods carriage at any
44AE
time during PY)
Capital Gains
2(14) Capital Asset
2(42A) Short-term capital asset
2(29A) Long-term capital asset
2(47) Transfer
45 Charging Section – Scope and Year of Chargeability of Tax
45(1) Gains arising from the Transfer of a capital asset effected in the previous year shall be
chargeable to Income-tax under this head in previous year in which transfer took place
45(1A) Insurance compensation for destruction of capital asset taxable in year of receipt
45(2) Conversion of capital asset into stock in trade taxable in a year of sale of stock.
45 (5) Compulsory acquisition of a capital asset taxable in the year of first receipt
45(5A) Specified arrangements (special provisions for computation of capital gains in case of
joint development agreement) taxable in the year of completion certificate
46 Capital gains on distribution of assets by companies in liquidation
46A Capital gains on buyback of shares or specified securities
Additional income-tax @ 20% (plus surcharge @12% and cess@4%) is leviable on
115QA
Company in case of buyback of shares (listed/unlisted) by Domestic Company
47 Transactions not regarded as transfer
48 Mode of computation of capital gains (indexation etc)
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Section Number Brief Description
Ascertainment of cost in specified circumstances where assessee becomes owner of
49
capital asset other than by purchase, like u/s 47
50 Capital gains in case of depreciable capital asset
SDV of land & building, held as a capital asset, where SDV > 110% of consideration,
50C
shall be the full value of consideration
50CA FVC in case of transfer of Unlisted shares, if sold for less than FMV, shall be FMV
50B Slump Sale
Where FVC is not determinable, Market value on the date of transfer of asset shall be
50D
FVC
51 Advance money received
55(1) Cost of Improvement
55(2) Cost of Acquisition
55A Reference to the valuation officer
112 Tax on LTCG [where securities transaction tax (STT) not paid]
Where STT is levied & securities is held as capital asset then LTCG shall be taxable u/s
112A
112A @ 10% on LTCG exceeding 1 lakh
Where STT is levied & securities is held as capital asset then STCG shall be taxable u/s
111A
111A @ 15%
54
54B
54D Refer Chart
54EC
54F
Other Source
56 Any receipt not assessable under any other head is assessable under Sec 56
56(2)(x) Taxability of Gift (covid related amendment)
57 Deductions allowable under Other Sources
58 Deductions not allowable
59 Deemed Income chargeable to Tax / Recoveries taxable
2(22) Deemed dividend
2(22)(a) Distribution of accumulated profits resulting in release of company’s asset
Distribution of debentures, deposit certificates to shareholders and bonus shares
2(22)(b)
to preference shareholders
2(22) (c) Distribution of accumulated profits at the time of liquidation
2(22) (d) Distribution of accumulated profits on reduction of capital
2(22)(e) Advance or loan by a closely held company to its shareholder, directly or indirectly
Consideration received in excess of FMV of shares issued by a closely held company to
56(2)(viib)
be treated as income of such company, where shares are issued at premium
Clubbing of Income
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Section Number Brief Description
60 Transfer of income without transfer of asset
61 Revocable transfer of Asset
64(1) Clubbing Provisions – Spouse
64(1)(viii) Income from assets transfer to third party for the benefit of daughter-in-law
64(1A) Clubbing Provisions – Minor child
64(2) Income from self-generated asset transferred to HUF without adequate consideration
27 & 64 Deemed ownership & Clubbing of Income (section 27 overrides section 64)
10(32) Exemption upto 1500 per child whose Income is clubbed in hands of Assessee
Set Off & Carry Forward of Losses
70 Intra- head set off of losses
71 Inter head set off of losses
72 to 74 Carry forward of losses
80 Submission of Return for losses u/s 139(1)
Deductions from GTI
80 C Eligible payments & investments in NSC/PPF/SPF/EPF/5-year FD etc. (upto 1,50,000)
80 CCC Contribution to Pension Fund/ Annuity plan of LIC or other insurer
Contributions to New pension scheme
80CCD (1) Employee’s contribution (10% of salary) or Self-employed (20% of GTI)
80 CCD
80CCD(2) Employer’s contribution (10/14% of salary) [amendment]
80CCD(1B) Employee’s contribution or Self-employed upto an additional 50,000
80 CCE Overall limit of deduction u/s 80C, 80CCC, 80CCD(1) restricted to 1,50,000
80 D Medical insurance premium (upto 25,000 or 50,000 as the case may be)
Deduction in respect of maintenance including medical treatment of a disabled
80 DD
dependant (flat 75,000/1,25,000) [Amendment]
Deduction in respect of medical treatment, etc (upto 40,000 or 1,00,000 as the case may
80 DDB
be)
Deduction in respect of Interest on loan taken for higher education of Assessee or
80 E
relative
Deduction in respect of Interest on loan taken for acquisition of first self-occupied
80 EEA
house property by an Individual between 01.04.2019 till 31.03.2022
Deduction in respect of Interest on loan taken for acquisition of first electric vehicle by
80 EEB
an Individual between 01.04.2019 till 31.03.2023
Donation to specified institutions/funds (deduction of 100%, or 50% or 100% out 10% of
80 G
adjusted GTI or 50% out 10% of adjusted GTI, as the case may be )
80 GG Deduction in respect of rent paid for residence
Deduction in respect of certain donation for scientific research or rural development
80 GGA
(No deduction if amount of donation paid exceeds Rs 2,000 in cash)
Deduction in respect of contribution given by Indian companies to political parties or
80 GGB electoral trust or advertisement in their publications (no deduction is allowed if
donation made in cash)
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Section Number Brief Description
Deduction in respect of contribution given by any resident person to political parties or
80 GGC
electoral trust (no deduction is allowed if donation made in cash)
Deduction @ 30% of additional employee cost in respect of employment of new
80 JJAA
employees for 3 PYs
Deduction in respect of royalty income etc., of authors of certain books other than text
80 QQB
books (3,00,000 or royalty income, whichever is less)
Deduction in respect of Royalty for patents (3,00,000 or royalty income, whichever is
80 RRB
less)
Deduction in respect of interest on deposit in saving account allowed to R/NR (max
80 TTA
10,000)
Deduction in respect of interest on deposit for Resident senior citizen or very senior
80 TTB
citizen (max 50,000)
80 U Deduction in case of a person with disability (flat 75,000 or 1,25,000 as the case may be)
Returns of Income
139(1) Filing Return of Income and Due Date
139(3) Loss return
139(4) Belated return
139(5) Revised return
139(8A) Option to File Updated Return of Income (Amendment)
139(9) Defective income tax return
139A Permanent Account Number
139AA Quoting of Aadhar number
139B Tax Return Preparer
140 Who shall Verify the Return
140A Self-Assessment Tax
140B Tax on Updated Return (Amendment)
234F Fee for delay in filling Income tax return
234H Fee for default relating to intimation of Aadhaar number/linking of Aadhar & PAN
Tax Deduction at Source & TCS
192 TDS on Salary (as per applicable slab rates)
193 TDS on Interest on Securities
194 TDS On Dividend (Including dividends on preference shares)
194A TDS on Interest on other than security
194B TDS on Winning from lottery etc.
194BB TDS on Winning from Horse race
194C TDS on Payment to contractor or sub-contractor for works contract
194D TDS on Insurance agent commission
194DA TDS on Payment of maturity of life insurance policy (including bonus shares)
194E TDS on Payments to Non-Resident Association/Sportsperson
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Section Number Brief Description
194F TDS on Repurchase of units by Mutual Fund or Unit Trust of India
194K TDS on Income on Units Other Than in Nature of Capital Gains
194G TDS on Lottery agent commission
194H TDS on commission/brokerage other than Insurance Commission
194I TDS on Rent
194IB TDS on Rent for land & building not covered u/s 194I (if Rent > 50,000 pm, @ 5%)
194J TDS on Professional service, Technical Services, Royalty and Director's remuneration
194IA TDS on Purchase of Immovable Property Except Agro-Land [Amendment]
194LA Compensation on Compulsory Acquisition of Immovable Property Except Agro-Land
TDS on payment made by individual/ HUF not liable to deduct TDS u/s 194J/194C or
194M
194H
194N TDS on cash withdrawals from Bank/PO
194O TDS on Payment by E-commerce Operator to E-commerce Participant
194P Deduction of tax by a specified bank in case of specified senior citizen
194Q Deduction of tax at source on purchase of goods
194R TDS on Benefits/ Perquisites in respect of Business or Profession(w.e.f. 01/07/2022)
195 TDS on payments made to Non-Residents and Foreign Companies
197 Certificate for deduction of tax at Lower Rate
197A Self-Declaration for Non-Deduction of Tax at Source
201 Consequences of Failure to Deduct or Pay TDS
206AA TDS at higher rate if PAN is not furnished to payer/deductor
206AB Higher Rate of TDS for Non-Filers of Income-tax Return
206C Tax Collection at Source
TCS on sale of scrap, tendu leaves, timber, forest produce, minerals (coal, iron ore),
206C(1)
alcohol for human consumption
206C(1C) TCS on grant of leasing rights for mining or quarrying, parking lot, toll plaza @ 2%
206C(1F) TCS on Sale of motor vehicle of value exceeding 10 lakhs @ 1%
206C (1G) TCS on Remittances outside India or sale of overseas tour programme package @ 5%
TCS on sale by a seller of goods (with turnover in immediately preceding PY > 10 crore)
206C(1H)
@ 0.1% on amount of sale in excess of 50 lakhs
Advance Tax
211 Instalments of advance tax and due dates
234A Interest (penal nature) for default in furnishing of Return of Income
234B Interest (compensatory) for default in payment of advance tax
234C Interest (compensatory) for deferment in installments of advance tax
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Compiled by: CA Kishan Kumar Fully Updated & Amended for May 2023
Notes:
The above is an illustrative list of important Sections at the Inter level.
At least memorize the bold ones.
Don’t learn any other Section / Notification or Definition unless you are fully comfortable with the
above.
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Yours Truly,
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